Thread by @DodgysDD

This thread will be explain WHAT Low Resistance Liquidity (LRLR) is and HOW I use it to predict the way price moves

🧵💎#ICT

Low resistance liquidity, is like a trend line, but forget anything you ever learned about a trendline, trust me. We do not use it like a trendline. We are not buying the breakout.

Here is an example, what low resistance liquidity is, is when a bunch of highs get created and each consecutive high is lower and lower.

What happens when all these lower highs keep being created, is liquidity is being “engineered” or in simple terms “built up”

Why is this? Well everytime we go smack this “trendline” retail traders buy puts, seeing it as resistance

Well what does the market want to do? The market aims to stop out the retail traders and stop them out as much as possible before the real move comes. So often what happens is something like this:

When this happens, after the first stop loss is hit, it triggers so many stop losses which trigger us to go higher, hit the next stop loss and so on, until all are taken out. So basically one stop loss triggers next stops to hit and it slices through quickly. Here’s an example:

Now here’s how I use LRLR, I like to see a trendline form, that is VERY algorithmic and LOOKS like a trendline to any new trader entering the market. So it must be obvious. Reason why is because the obvious ones ALWAYS break, because a retail trader uses it as support/resistance

You have to understand, any trendline that looks algorithmic like this ALWAYS breaks, and I use this to hunt where the market goes, how to know to enter/exit a position etc.

The first thing you have to know about LRLR, is you DONT know when it’s going to break without an entry. The only way I know LRLR will break is when we get an entry.

In this example I alerted in discord that we were going to blast above it because it looked so algorithmic, meaning it was obvious a bunch of retail traders were shorting, and retail does not win, so they will get stopped.

BUT, in this example there was never really an entry telling us it WAS going to break, so if that’s the case, I do not long, I just have a rule not to short when I see these forming, because I know we will break them so why would I want to short?

In this example, this looks like a textbook long right? Nope, even if I thought it was, it would be against my rules to long with the LRLR forming below. Let’s say I enter anyways and notice LRLR forming in the middle of position, I just get out early. That saves me me many times

Although sometimes the play ends up working with LRLR, getting out in the middle of the position instead of letting full stop hit, more times than not I will know I am going to get stopped before I do when I see this LRLR form slowly after entry.

When do I know LRLR will break? Well, when you see a FVG entry, in this example, I know the LRLR will break on this specific leg because it gives us a textbook entry before the break

My main rules regarding LRLR,

I never long if I see really obvious and an algorithmic trendline forming to downsize

I never short if I see really obvious and algorithmic trendline forming to upside

Even if it works, I do not care.

I also like this LRLR to be built up in the direction to where I think buyside it, so if I think buyside is above, I want to see a nice algorithmic buildup of lots of consecutive lower highs

Another thing, if I see we hit major buyside on HTF, but we are building LRLR to the upside (an algorithmic set of consecutive lower highs) I typically wait for a short until the trendline is taken out

That’s it for now, if you are ever stuck on where you think price is going, use trendlines/LRLR to your advantage, they always break:)

Here’s my discord for anyone interested in joining and patreon where I live trade and teach all this in live time EVERY day discord.gg/2sxksdgw patreon.com/dodgysdd